Week ahead: Alphabet, Tesla results due; ECB announcement eyed

(Sharecast News) - Among the highlights next week will be results from JD Wetherspoon, Alphabet, Tesla and Intel, as well as the latest policy announcement from the European Central Bank. Monday will bring the release of eurozone construction output figures for May.

On Tuesday, interim results from Mony Group and trading updates from caterer Compass and construction group Kier will be out. In the US, quarterly results are due from 3M, General Motors and Halliburton.

On the macroeconomic front, there will be a raft of UK data releases, with the unemployment rate, claimant count, average earnings and the latest public sector net borrowing figures all due.

On Wednesday, Reach will release interim results, while JD Wetherspoon will publish a fourth-quarter trading update.

AJ Bell analysts Dan Coatsworth and Danni Hewson said: "Pubs group JD Wetherspoon is a business which has always prioritised sales over margins and which leans heavily on its value credentials when it comes to getting punters through the doors. This means it is particularly exposed to the renewed inflationary pressures at work in the economy.

"That was evident in March's profit warning when the company warned of the impact of cost spikes. The shares have subsequently been on a recovery path, helped by a third-quarter update in May which revealed a 3.4% increase in like-for-like sales. While growth is slowing this was still a better showing than many of its hospitality rivals."

They said key items under scrutiny when Wetherspoons updates on fourth-quarter trading will be the extent to which sales growth has held up or even improved in late spring/early summer, and whether there has been a meaningful boost from the World Cup given Wetherspoons pubs are not traditionally venues for sports fans.

"Investors will also want to hear if the company has managed to keep debt levels, elevated ever since the whole industry was ravaged by Covid, under control," they said. "Attention is also likely to be paid to if costs have been mitigated sufficiently to help profit match expectations or fall slightly below as Wetherspoons warned it would in May."

Across the pond, quarterly results from AT&T, Alphabet, Philip Morris and Tesla will be in focus.

Alphabet shares fell sharply on Thursday 16 July following a report the company has delayed releasing its flagship AI model. According to Bloomberg, Alphabet's Gemini 3.5 Pro AI model is months behind schedule.

On the macro calendar, UK consumer price and producer price inflation figures for June will be eyed.

Thursday will bring full-year results from The Works and half-year results from Morgan Sindall. In the US, quarterly results will be released by Intel and Newmont.

The latest policy announcement from the European Central Bank will also be in the spotlight amid expectations it will leave the deposit rate unchanged at 2.25%.

Carsten Brzeski, global head of macro at ING said that until early last week, he would have argued that lower energy prices took the rate hike option entirely off the table for the ECB's July meeting.

"But some members might feel tempted to use the latest resurgence in energy prices as a reason to get things done as quickly as possible, potentially even as soon as next week," he said.

"While the ECB doesn't have a recent track record of surprising markets, hiking rates next week would simply get the job done. Also, at least for the hawks, there remains a risk that any relief in oil markets ahead of the September meeting could mechanically lower inflation forecasts, removing the justification for a second rate hike.

"All in all, there remains a small chance that the ECB will hike next week. The more realistic scenario, however, is a hike at the September meeting. In any case, instead of a summer lull, next week's meeting promises one last clash between the hawks and doves before anyone reaches for the sunscreen. The towels may already be laid out, but for the ECB, the beach break will have to wait."

On Friday, American Express will release second-quarter earnings.

On the macro front, UK retail sales figures for June will be among the highlights, along with US new home sales data for June.